Volkswagen scandal promts Axa IM and other European fund managers to demand car makers be more open about their environmental policies

"It is in the interests of investors and the environment alike to gain a better understanding of what goes on behind closed doors.” (Source: Getty)

European funds managers, running more than £625bn in assets in total, have called for greater scrutiny of car manufacturers' lobbying activities in the wake of the Volkswagen emissions scandal.

European investment managers including Axa Investment Managers, Menhaden Capital run by Zac Goldsmith's brother Ben, and the Environment Agency's pension fund have called on car giants to be transparent about lobbying on environmental public policy and how much they spend on trade associations.

The group of 19 funds wrote to Volkswagen, BMW, Honda, Daimler, General Motors, Ford, Fiat, Peugeot and Toyota requesting detailed information on the lobbying position they are taking on emissions legislation currently being debated in the US and EU.

The letters ask for specific details on the companies’ positions on proposed EU CO2 emissions standards and US fuel efficiency and greenhouse-gas emissions targets.

The group has also called for clarity over the regulatory process for these standards, and the disclosure of activities by the trade group European Automobile Manufacturers' Association (ACEA), which has been obstructing the progress of EU emissions regulation.

Seb Beloe, partner and head of research at WHEB Group, one of the signatories, said: “The Volkswagen crisis has helped to uncover the unhealthily close relationship between the automotive industry and regulators, particularly in Europe.

“In the long-run this undermines the competitiveness of the European car makers and we believe it is in the interests of investors and the environment alike to gain a better understanding of what goes on behind closed doors.”

The move comes as the European Investment Bank (EIB) reviews its loans to Volkswagen and what they were used for, which could lead to the bank recalling the debt. Since 1990 the EIB has lent VW some €4.6bn (£3.4bn), €1.8bn of which is reported to be outstanding.